What are the advantages of a travel installment card

How an installment card for travel works

Some travel companies are also partner stores that offer tourists the option to book a tour in installments. You visit the office or online store of a travel agency, choose the tour you like, and then pay for the purchase in installments.

However, a travel installment card provides for the payment of not only last-minute tours, but also additional opportunities. By contacting a tour sales agency, you can arrange the following in installments:

1. Purchase of train, air, and bus tickets.
2. Purchasing last-minute and standard tour packages.
3. Paying for accommodation in hotels and inns.
4. Additional services, such as car rental and carsharing.

The installment period depends on the specific partner store selling tour packages. Typically, the average installment term is 12 months, though some companies offer 18-month installment plans.

How tour packages are paid for in installments

You visit a travel agency office and choose a tour to Europe, Asia, or Russia that you like. The travel agency automatically becomes a partner of the issuing bank for the installment card. Suppose the cost of the tour is 96,000 RUB. The travel agency provides a 12-month installment plan. Starting next month, you pay equal installments of 8,000 RUB over the course of one calendar year. If you miss a deadline by even 1 month, the standard interest rate applicable to credit cards comes into effect. As a rule, installment cards feature the lowest interest rates starting from 10% per annum.

If you make all payments on time and have no debt, you will fully repay your debt to the issuing bank after 12 months, essentially enjoying a 0% interest-free period for 1 calendar year. This is a major advantage of all installment cards: if you repay the debt on time, you are granted an interest rate of 0% per annum.

A disadvantage is the limited credit limit. For the most part, the maximum allowable credit limit does not exceed 300,000 RUB, sometimes 350,000 RUB. A number of issuing banks allow depositing personal funds onto the card, which enables earning interest on the balance and participating in loyalty programs (cashback).

Differences from credit cards

An installment card for travelers is a separate banking product and has a number of differences from credit cards. Some banking products (credit cards) have a targeted purpose. You can use the credit limit exclusively for travel. In addition, credit cards offer a higher credit limit, reaching 600,000 to 1,000,000 RUB.

Installment cards can be used for travel, but there are some restricted options. For instance, withdrawing cash is extremely unprofitable. However, this option is still available. For example, the Sovest installment card allows cash withdrawals, but not exceeding 15,000 RUB.

These are basically the main advantages of credit cards over installment plans. Otherwise, installment cards have advantages over the equivalent banking product—credit cards:

• The maximum installment period is 12–18 months, whereas credit cards can offer an interest-free grace period of no more than 120 days (sometimes 150 days) for the banking product. For the remainder of the credit card term, you will have to pay an elevated interest rate for using borrowed funds.
• The number of partner stores for installment cards numbers in the tens of thousands. There is no such concept as partner stores for credit cards, but they do offer cashback, meaning a refund on purchases (no more than 7%-10%).
• No overpayments whatsoever. Installment plans involve paying in equal parts every month. If you make timely payments, you are not charged interest rates. Credit cards feature elevated interest rates in case of late payment.
• Minor penalty fees. Installment plans involve insignificant penalty fees. Some issuing banks allow delays of up to several days without a penalty. Thereafter, the standard interest rate starting from 10% per annum applies.
• Accessibility. An installment card for travel is easier to obtain than a credit card. Specifically, the approval rate for installment cards can reach up to 80%, while for credit cards it is no more than 40%.

An important condition for installment cards is compliance with debt payment deadlines. Purchases are subject to an equal-installment payment schedule. This way, you will avoid the accrual of penalties.

How to conveniently use an installment card for travel

It is unrealistic to memorize a huge number of partner stores, so the best solution is to set up your personal account on a PC or mobile device. This way, you will always be aware of what financial transactions are being made with your card and which partner stores are available to you in your city of stay for your installment card. Currently, a number of travel agencies have become partners of issuing banks. Thus, you can find well-known Russian tour operator brands on the list, such as Tsentrsport, TEZ TOUR, PEGAS Touristik, Coral Travel, OneTwoTrip, and others.

Your personal account always provides information on how to make installment payments correctly, as well as the payment amount and deadline available for your banking product. For convenient management of your installment card, we recommend enabling SMS notifications. This way, you will always be aware of new updates and current expenses on your card.

The financial services comparison platform invites you to apply for advantageous travel installment cards that will help you manage your finances wisely, eliminating the need to accumulate cash savings before going on a trip.

When filling out the application, pay close attention to the questionnaire. You follow the link to the issuing bank's official website, submit an application, fill out all the fields in the questionnaire, and wait for the financial institution's decision. The online application review time is up to 10 minutes. The card is delivered by a courier service. You can also receive the banking product at a bank branch or via the Pochta Rossii postal network. The minimum credit limit for the banking product is determined based on the information provided by the potential borrower. It is recommended to indicate your main sources of income, including salary, pensions, bank accounts, etc.